Archive : Innovation

There is no denying that technology is changing the landscape for financial advisors. On the surface, some of the technology appears to compete with and take business away from humans. Yet other technology allows advisors to increase their efficiency and lower business costs. And the need still exists for insight and understanding of client concerns that only a human financial advisor can offer.

Digital disruption has occurred at every level of our society. In some areas, the disruption has resulted in innovation and successful adoption of new business models while, in other areas, the result has been a disconnect between the companies and individuals providing products and services and the consumers who want, need and are willing to pay for them. The effects of disruption are especially prevalent in the financial services arena.

Disruptive innovation is happening all around us. And with the advancement of artificial intelligence (AI) and robotics, the future for us humans can start to look as dystopian as some of the darker science fiction movies (think “Blade Runner” and “Terminator”). But there is a light at the end of this tunnel. Humans want and need to interact with other humans and that includes human advisors. They just don’t seem to realize the true value because they have a misunderstanding of what a financial advisor does. And, thanks to the Internet and other digital technologies, many consumers think they can do it themselves.

Giving customers online and mobile access does not automatically make a company customer-centric. Those are distribution channels. And they seem to be the migration that many life insurance companies have taken. Moving from captive distribution to independent distribution to the newest strategy of direct to consumer is still distribution-focused.

Innovation and advances in digital technology are happening all around us. And while much of the innovation in the life insurance industry thus far has taken place on the back-end, i.e., improved processing and information gathering, the front end of life insurance still looks very much the same as it always has. Unfortunately, the consumer market has dramatically changed. We are now looking at Millennials being the largest population group, finally surpassing Baby Boomers in 2016 according to a Pew Research Center Study. Why is this critical for the life insurance industry?